Talentmanagementdemystified
A white paper that explains the principles behind organisational talent
management, its link to succession planning and the latest thinking in
developing an effective strategy to embed it in any organisation
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Finding and keeping the talent organisations need to succeed in a competitive and globalised world is increasingly
difficult. However, developing an effective strategy and embedding it can be far from straightforward. This is
backed up by the CIPD’s Learning and Talent Development report, which confirms that only 57 per cent of
organisations surveyed have talent management strategies, and just 8 per cent of those believe their activities are
‘very effective’.
A skilled, flexible and adaptable workforce is the lifeblood of resilient, sustainable, future-proofed organisations.
Talent management and succession planning can be “an agile mechanism for speeding up adjustment to shifting
business demands and diverse employee desires,” says Wendy Hirsh, an independent researcher and consultant in
employment issues.
Thechallengeofdefiningtalent
Traditional talent management programmes have tended to focus on an elite group of people who have been judged
capable – with the right grooming and development opportunities – of fast-tracking through the organisational
hierarchy. More recent thinking is that such a narrow definition of talent could be detrimental to the business, as
HR guru David Clutterbuck points out in his new book, The Talent Wave.
“In the flurry to find the nuggets of gold, other precious metals get overlooked,” says Clutterbuck. “It is my firm
belief that the more people an organisation has who are perceived and perceive themselves as talented, the greater
the energy that can be directed towards achieving shared objectives, and the higher the attractiveness of the
organisation to talented people.”
Defining talent management and aligning it to the culture and business priorities within their own organisation
is perhaps the first challenge human resources professionals will face. For some people, talent management and
succession planning are synonymous; for others, talent management means seamlessly integrated efforts to attract,
develop and retain the best people. For others still it means efforts designed to integrate all components of an
organisation’s HR system to attract, select, develop, appraise, reward and retain the best people.
The best advice, suggests Professor William J Rothwell of Pennsylvania State University, is to “come up with
a definition for talent management that meets your organisation’s unique needs”. Talent management is not
something done in isolation by HR people, but something that takes the organisation’s strategic objectives as its
starting point and works back from there. What sort of skills and competencies will the organisation need in the
future, and how should it go about developing them?
As such, HR must work closely with the CEO and the senior executive team from the outset to create a talent
management strategy that is ‘fit for purpose’ and has their full support. Gyan Nagpal, talent strategist, leadership
coach and author of a new book, Talent Economics, agrees. “In the 21st century, successful companies will find that
talent decisions must be woven into business decisions.”
Talentpools,pipelinesorwaves–thelinkbetweentalentandsuccessionplanning
Identifying those ‘talented’ individuals and categorising them as such has led to much debate. More recently the
term “wave” has joined the more traditional ‘pool’ and ‘pipeline’ terminology, when referring to talented people.
Clutterbuck thinks terminology matters because the metaphors we use shape our assumptions, which in turn
influence processes, expectations and behaviour. He thinks the frequently discussed ‘pools’ and ‘pipelines’ are
unhelpful concepts in talent management, because pools are stagnant and pipelines linear, constrained and prone to
leaks. Waves, on the other hand, are “pure energy”.
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And the essence of a ‘talent wave’ mindset is, he says, “enabling talent to make its own way, instead of trying to
predict the unpredictable”. That means HR ceding control and putting more responsibility on employees themselves
– because, as he says, it’s not just the economic environment that’s changing, but employees too. We live in an age
of non-linear careers, in which younger employees in particular don’t necessarily aspire to their boss’s job and seek
more meaning from work and more balance in their lives.
Clutterbuck points out that the qualities that make people talented are often those that make them unique, difficult
to classify and unpredictable. “The more HR tries to make talented people fit standardised talent management and
succession planning processes, the more likely it is to fail,” he says. “The role of HR is not to control the succession
planning process, but to enable it.”
Clearly, the need to have the right talent in place to help the organisation survive and thrive in a constantly
changing landscape is a given. HR’s role is to ensure that everyone in the organisation understands that. One HR
director interviewed for a Corporate Research Forum report summed up the challenge as follows: “We need to
ensure that talent management becomes part of our culture – not just a set of tools – and that everyone knows they
are accountable for managing talent and for managing their own careers.”
For most organisations, knowing that for key positions, at least, there is a succession plan in place will be
comforting. However, talent management can bring more to the table if it links to other areas of the business, rather
than just a pool or pipeline of people able to succeed each other.
Investingintalentandlosingitshouldn’tbefeared
You still hear business leaders expressing reluctance to invest in training and developing their people because they
quickly lose them to competitors. But research suggests that, whatever they say, most people don’t leave a job for a
higher-paying job elsewhere: they leave their bosses.
Losing people isn’t necessarily a bad thing – provided you lose them for the right reasons. Clutterbuck argues that
one of the best ways to attract talent is to have a reputation for losing it. He has explored the concept of ‘talent
factories’ – companies that had a reputation for producing so much talent in particular disciplines that their alumni
accounted for a disproportionate percentage of people in top roles in other companies. Ford, for example, excelled at
creating finance directors; Mars, HR directors and Procter & Gamble, marketing directors.
“In each case, the company took in and invested deeply in highly talented young people, knowing that many of
them would be stolen by headhunters at some point,” Clutterbuck writes. “The trade-off was that by having a
reputation for developing talent in these disciplines, the companies attracted very bright, motivated people into
those functions. When these people stayed they brought a high level of commitment and energy to their job roles.
When they moved on – with the companies’ blessing – they created an updraft that sucked in new talent, with new
ideas.”
Conclusion
Talent management is essential to future-proof the organisation and allow it to remain competitive. However 92 per
cent of organisations don’t rate their talent management as “very effective”. This represents a considerable challenge
for HR professionals, who may need to rethink their traditional approaches. The nature of modern organisations
and employees means that careers are no longer linear, and individuals are motivated by a range of different criteria.
The role of HR in this new environment is one of enablement, not control. It involves identifying a talent
management strategy and processes that fit uniquely with your organisation’s requirements and future direction,
then embedding them into the culture and other areas of your business.
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This approach should be flexible and have the ability to align with the constantly fluctuating demands of
environment, company and employee. A strategy that is right for one organisation isn’t necessarily right for another
but one thing is for sure: successfully embedding it in the culture of the organisation and aligning it to business
objectives and strategy are key. HR can be incredibly influential here: with the backing of the senior executive
team, the use of processes and strategies in areas such as recruitment, performance management, training and
development and reward will undoubtedly bring benefits such as a stronger employer brand and greater employee
engagement while ultimately increasing profitability.
Nextstepstoimplementinganeffectivetalentmanagementstrategy
Before starting, you will need to be able to say yes to the following questions:
1. Is your organisation willing to invest in developing staff?
2. Does your organisation have a business plan stating objectives?
3. Do you have a performance management process?
4. Will the strategy be supported by senior colleagues?
5. Do you have the time to invest in developing the strategy, implementing and monitoring it?
From that point, there are a number of areas to tackle:
• If you have a succession planning strategy, decide if this will form part of a wider talent management strategy
• Define what talent means to your organisation and ensure that progression is seen as horizontal as well as vertical
• Ensure that you have time to review other strategic HR elements that will feed into the talent management
strategy, such as recruitment, performance management, training and development, reward etc.
• Identify the organisational objectives and how the talent management strategy can support their achievement
• Decide on KPIs/deliverables to measure success
• Communicate with all employees to ensure that talent management becomes part of your culture and people
accept that it is everyone’s responsibility.
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Formoredetails,contact:
SageHR&Payroll
08006940568
snowdropkcs@sage.com
www.snowdropkcs.co.uk
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